Bharti buys TIW stake in Hexacom

NEW DELHI: In a surprise move, Bharti has decided to buy out the stake of Canada-based Telesystem International Wireless (TIW) in Hexacom, a Shyam Telecom-promoted cellular firm in Rajasthan.
Going by Bharti’s record, the move may see it gradually acquiring a controlling stake in Hexacom. TIW holds 27.5 per cent stake, valued at Rs 102 crore. On whether his firm would buy out the entire stake in Hexacom, Bharti CMD Sunil Mittal said, “If we get an opportunity to increase the stake, we would like to do that�.
He added that the company had submitted a letter of intent (LoI) to operate cellular services in Rajasthan, and if the deal went through the LoI could be surrendered.The other major partners in Hexacom — Shyam Telecom and TCIL — hold 40 per cent and 30 per cent stake, respectively, and have the first right of refusal to buy TIW stake.
On whether Shyam would buy TIW’s stake, Shyam Telecom CMD and Hexacom chairman Rajiv Mehrotra said, “We will study the proposal when it comes to us and then decide�. Hexacom operates GSM mobile network in Rajasthan and had over 200,000 customers by November-end, with over 48 per cent marketshare.
Shyam Telecom also operates landline services in Rajasthan and offers CDMA-based limited mobility services under that licence. This is viewed as a conflict of interest between the two firms. Besides, it is believed that being a small, single-circle operator, Shyam had little resources and scope to expand in the country’s telecom market that is fast consolidating around big and integrated players like Bharti, Hutch, Reliance, the Tatas and state-owned BSNL. Bharti said if regulatory conditions were met, the sale would close within two months. The deal will expand its cellular footprint to 16 telecom circles in the country.